A Future for Public Media in New Jersey

How to Create a New Basis for Public Radio, TV, and Online Media in One of American Journalism’s Worst Covered States

By Paul Starr, Scott Weingart and Micah Joselow

Introduction

Public, noncommercial media could be an important part of the answer to New Jersey’s need for independent news about public affairs. But achieving that goal requires a radical rethinking of the state’s obsolete system of public television, the development of a new public radio and online news network, and the creation of a new partnership involving universities, private foundations, and media organizations both inside and outside of the state.

New Jersey’s need for news arises today from three sources

First, the state has suffered from a chronic news deficit because it lacks a media center of its own and its citizens watch, listen to, and read media based in New York and Philadelphia, which provide little coverage of New Jersey.

Second, in recent years, newspapers and other traditional news media in New Jersey (as in other states) have cut back their newsrooms, while online and other new media have not come close to compensating for the decline. As a result, the number of journalists covering state and local affairs in New Jersey has dropped sharply, and the ability of the press to serve as a watchdog has diminished.1

Third, the state has long mismanaged its system of public broadcasting, failing to keep up with changes in the media and subjecting its public-broadcasting organization, NJN, to excessive political control. When the state established the forerunner of NJN in the 1970s, television dominated the electronic landscape, and New Jersey’s leaders understandably sought to redress the failure of commercial television to cover the state’s news.

But in recent decades, the media realities in American society have changed. As cable TV (including cable news) has developed, commercial channels have taken over some of the original functions of public television, which has seen its audience shrink. In contrast, as commercial radio stations have abandoned news, public radio has gained listeners and become a major source of independent journalism. Nonetheless, NJN has repeatedly failed to take advantage of opportunities to develop a statewide public radio network. Similarly, as the Internet has developed, NJN has also failed to adjust to the new online environment, continuing instead to invest its resources in an evening TV newscast with a tiny share of the state’s viewers. In addition, NJN failed to take advantage of new means of producing video that could have sharply reduced its costs.

Furthermore, while other news media have played a critical role in exposing corruption in New Jersey, NJN has been too dependent on political sources of funding to bite the hands that feed it. Jim Willse, the former managing editor of the Star-Ledger, says that when he arrived in New Jersey in the 1990s, he felt like a hunter coming to a game preserve.2 Nonetheless, despite being in a target-rich environment, NJN has not done a lot of hunting. And now that newspapers are retrenching (the Ledger itself has disbanded its investigative-reporting unit), the limitations of NJN’s journalism become all the more troubling.

Today, amid a general budgetary crisis, the state has cut the funds for NJN and is on the verge of eliminating that support altogether. These cuts may only compound the losses in news coverage resulting from retrenchment by the state’s newspapers. But the crisis could also become a moment of opportunity-if the state’s policymakers, working with other groups, have a broad enough vision of what needs to be done and allow NJN’s assets to be deployed in new ways to accomplish the original objective of providing independent journalism about the state’s affairs.

This report reviews the options for achieving that objective. Part One explores the possibilities for building statewide public radio, which could become a critical basis for an independent, multi-platform news network. These options include the development of public radio by 1) WNYC, which already has the most public-radio listeners in New Jersey; 2) a restructured NJN, if it is allowed to sell off, lease, or trade some or all of its television licenses; or 3) a new partnership or consortium, potentially involving NJN, WNYC, and colleges operating noncommercial radio stations, enabling them to establish the public-radio network and programming that New Jersey should have created years ago.

Part Two of this report explores the options for NJN. Insulating NJN from political control should be a priority in any reorganization, but that objective can be accomplished in several ways. As it evaluates plans for restructuring NJN, the state should also consider what functions a restructured organization ought to serve.

Two proposals for NJN are currently under discussion. The first would transfer NJN and its broadcast licenses from the state to the nonprofit NJN Foundation, which has raised money for NJN. This proposal follows the example of several other successful conversions of public broadcasters from governmental to nonprofit community ownership. But in those cases, the public broadcasters have had two sources of revenue that NJN does not have. The organizations were producers of programming purchased by other public stations, and they enjoyed strong membership loyalty in their own area. The little original programming NJN produces has no market elsewhere in the country, and the network has a weak donor base, in no small measure because of its failure to develop a strong radio station, with the result that most New Jersey donors to public radio send money to WNYC in New York or WHYY in Philadelphia. Partly because of the uncertainty created by the state, NJN does not yet have a financially realistic plan that would remedy its underlying deficiencies and enable it both to sustain its current TV operations and to develop the radio, online, and mobile capabilities that NJN’s leadership now recognizes is essential to its future.

The second approach, reorganizing NJN as an independent public corporation, follows the model of the BBC and public-service broadcasters in Canada, Australia, and other Western countries, which operate at a high professional level and provide the citizens of those countries with essential public-affairs journalism. This approach would involve continued state support, but through an institutional structure that freed NJN from many of the constraints under which it now operates. The key constraints that need to be lifted, however, are the legislature’s control over employment levels at NJN and the governor’s control of each of the network’s individual hiring decisions. It is not clear, however, that the political will exists to give NJN that degree of autonomy as a public corporation.

In any conversion plan, the state needs to decide, at least on a preliminary basis, how to deal with NJN’s broadcast licenses: Should they be sold, leased, or simply turned over to one organization such as the NJN Foundation? Or should the radio and television licenses be treated differently? NJN’s radio stations reach only about one out of five of the state’s households and have signals so weak that they are of little value to listeners in automobiles, who represent half of the radio audience. Those stations should remain as part of a restructured NJN only if it is allowed to sell one or more of its TV licenses and use the proceeds to acquire a strong, class B radio station that could reach most of the rest of the state’s population, including its commuters. Otherwise, the state should allow a restructured NJN to sell those radio licenses to WNYC, which has an interest in buying them and creating public-affairs radio programming for New Jersey, or the state should turn them over to a new statewide consortium capable of building a statewide radio network.

NJN’s four television licenses pose a more complex set of problems because of potential changes in their value depending on national policy decisions. In the short- to medium term, NJN probably needs only two of its television licenses (in northern and southern New Jersey) and should be able to monetize the value of at least one of the others to provide capital for other investments. Some reports have quoted an estimate of $200 million as the value of the four licenses, but it is unclear what the basis for that estimate is. Under current law, the licenses can be sold only to other public television stations or to religious broadcasters, and with so few potential buyers, the price the licenses could actually command is uncertain.

Ultimately, broadcast licenses will be unnecessary for public television distribution. Most TV viewers today do not receive the broadcast signal at all; 90 percent watch television via cable or satellite, and the main reason stations continue to transmit an over-the-air signal is the “must-carry” rights that come with their licenses-that is, their right to insist that cable networks carry their channels. But Congress could provide an incentive to stations to give up their use of the spectrum by guaranteeing their must-carry rights even if they no longer broadcast.

In its recent report on a national broadband strategy, the Federal Communications Commission set a goal of shifting 120 megahertz of spectrum from broadcast television to broadband by 2015. The FCC wants to use a variety of techniques, such as repacking the broadcast spectrum, to free up bandwidth that can be auctioned for wireless broadband, with the resulting revenue to be shared between broadcasters and the government.3 There is a diminishing rationale for TV broadcasting. Not only do most households receive television via cable or satellite; many people, especially the young, increasingly watch TV via the Internet or cable whenever they want, rather than being constrained by a TV schedule. Universal, high-speed broadband will make TV broadcasting entirely obsolete and allow more viewing on demand rather than by appointment. (Though it will eventually suffer the same fate, broadcast radio continues to have a large audience and a somewhat longer lease on life, thanks largely to commuters.)

As a result, though the pace of change is not yet clear, much of the value of NJN’s TV licenses may lie in their eventual use not for broadcast television but for broadband. In the long run, instead of remaining in the TV distribution business-mostly retransmitting PBS programs and producing only a little of its own-NJN should convert its licenses into an endowment, restructure itself into a production organization focused on New Jersey news, public affairs, and cultural life, and distribute its work in multiple formats via the Web, cable, and other media.

The difficulty is not so much understanding where NJN must ultimately go as figuring out how it is going to get there, given its present dire condition and the state’s determination to end subsidies. Because of the budgetary crisis, the interest in zeroing out expenditures on NJN has dominated the discussion about its future. But it would be folly to let those short-term considerations overshadow the larger, long-run stakes. At a time when newspapers and other commercial news media are shrinking their newsrooms, adopting a plan that would necessitate a further shrinkage of news coverage in the state would do more damage to the voters’ ability to keep an eye on government. It is crucial to keep in mind the purpose for which NJN was established, and for which it received its broadcast licenses-to inform and educate the people of New Jersey. That still must be the governing criterion in deciding what to do with NJN as an organization and with its licenses. It would be particularly unwise for the state to sell off all of NJN’s licenses in what would be a distress sale when the value of those licenses could rise considerably in the future.

After reviewing various options for developing public radio and restructuring NJN, this report outlines a preferred option for developing New Jersey Public Radio and sets out a two-year plan for converting NJN first into a public corporation and then into a private community nonprofit, dedicated to producing nonpartisan journalism and programming about and for New Jersey in audio, video, and text to be distributed through both traditional media outlets and new media. To facilitate NJN’s transition and treat its employees fairly, the report recommends that the state transfer the broadcast licenses to the temporary public corporation and allow it to sell either the radio licenses (to WNYC) or one of the television licenses (to another public station or a religious broadcaster) to create a “transition fund” of at least $5 million for employee severance, early-retirement packages, and retraining. The hour is late to save NJN. But New Jersey still has the opportunity to turn it from an outdated television network into a model for multiplatform public media that fits the conditions of the twenty-first century.